Business Loans

5 Best Online Business Loans in 2020

If you need business financing in a hurry, an online business loan could be your best bet. Online business loan lenders typically provide faster access to capital than traditional financial institutions, and may have more lenient eligibility requirements than banks.

Online small business lenders are often able to process and approve loan applications within a business day. They’ll look at factors such as credit score, annual revenue, profitability and time in business.

5 best online business loans in 2020

When selecting lenders, we considered how much money you could borrow and how quickly you could receive those funds. We chose loans that could be available less than a week after approval and could cover small, medium or large business expenses. Online small business lenders that appear on this list meet the following criteria:

  • Loan amounts as high as $200,000 to $500,000
  • No more than 2 years in business required
  • Funds available in 1 to 3 days
  • Terms as low as 3 to 6 months
Loan Amount Time in Business Loan Terms APRs Time to Funding After Approval
OnDeck $5,000 to $250,000 1 year 3 to 18 months Starting at
As soon as same day
Funding Circle $25,000 to $500,000 2 years 3 to 120 months Interest rates from 4.99% to 24.90% As quick as 1 business day
CAN Capital $2,500 to $250,000 6 months 6 to 18 months 16.00% to 36.00% As quick as 1 business day
iAdvance Now $30,000 to $200,000 2 years 12 to 60 months 6.99% to 26.99% 3 to 7 business days
Fora Financial $5,000 to $500,000 6 months 3 to 15 months Factor rates as low as 1.10 to 1.40 As little as 72 hours

Rates accurate as of Feb. 26, 2020


Why it’s among the best: OnDeck’s business loans start at $5,000, among the lowest minimums on our list. Its short repayment terms would allow you to quickly pay off small debt.

OnDeck offers short-term loans between $5,000 and $250,000 with repayment terms from 3 to 18 months. APRs start at 35.10% for the strongest applicants, though the average APR for term loans is 49.06%. The company charges a one-time origination fee based on your loan amount, which is included in your APR.

OnDeck collects daily or weekly payments and doesn’t charge prepayment penalties. To be eligible, borrowers must have at least:

  • 1 year in business
  • Personal credit score of 600
  • Annual business revenue of $100,000
  • Business bank account

When applying online, you would also need to provide your business tax ID number, Social Security number, average business bank account balance, estimated annual gross revenue and last three months of business bank statements.

OnDeck performs a soft credit pull when reviewing applicants, which wouldn’t affect your credit score. Once approved, you could receive funding as soon as the same day.

Funding Circle

Why it’s among the best: Funding Circle offers short and long repayment terms for business owners looking to quickly pay off debt or stretch out payments.

Funding Circle’s online business loans are available from $25,000 to $500,000, while terms span 3 to 120 months. It deducts a one-time origination fee between 3.49% and 6.99% of your loan amount before sending you your funds. Interest rates range from 4.99% to 24.90%. The company doesn’t charge prepayment penalties.

Applicants must meet Funding Circle’s minimum requirements:

  • 2 years in business
  • Personal credit score of 660
  • No bankruptcies in the past 7 years

Funding Circle might also ask for your business tax ID, Social Security number, driver’s license number, two most recent business tax returns (and one personal return) and six months’ worth of business bank statements. The company performs a soft credit pull while reviewing your application, which wouldn’t affect your credit score.

When you accept an offer, you could get your loan in as quick as one business day. For most borrowers, the process could take five days after submitting an application.

CAN Capital

Why it’s among the best: CAN Capital offers small to medium loan amounts — $2,500 to $250,000. Businesses with just six months in operation may be eligible, making CAN Capital ideal for newer companies.

CAN Capital’s business loans come with repayment terms from 6 to 18 months. APRs range from 16.00% to 36.00%, which includes an origination fee of up to 3.00%.

To qualify for a loan, applicants must have:

  • 6 months in business
  • Personal credit score of 600
  • $150,000 in gross annual revenue

Businesses may not have more than $175,000 in outstanding tax liens or judgements to be eligible for financing. Recent personal or business bankruptcy could also impact eligibility.

When you apply, CAN Capital would request additional details such as your type of business, when you need funds, last year’s tax return or a year’s worth of bank statements. If approved, you could receive funding in as quick as one business day.

iAdvance Now

Why it’s among the best: iAdvance Now offers repayment terms as long as 60 months for relatively small loan amounts — $30,000 to $200,000.

While iAdvance Now provides smaller loan amounts than some other lenders, its repayment terms can be quite lengthy — between 12 and 60 months. APRs range from 6.99% to 26.99%. iAdvance Now does charge an origination fee, but doesn’t disclose the amount until you submit an application.

Applicants must meet iAdvance Now’s minimum criteria to be eligible for a business term loan:

  • 2 years in business
  • Personal credit score of 650
  • $10,000 in gross monthly revenue

Applicants may need to submit several documents, including three to four months’ worth of business checking account statements and two to three years of personal and business tax returns, as well as a profit and loss statement, balance sheet and debt schedule.

After your online business loan approval, you may receive your funds in three to seven business days, a larger window of time than what other lenders advertise.

Fora Financial

Why it’s among the best: Fora Financial offers the shortest repayment terms on our list, making the lender well-suited for business owners who need an infusion of capital that they can repay right away.

Fora Financial’s online business loans are available between $5,000 and $500,000 with terms from 3 to 15 months.

The company uses factor rates, which are written as decimal figures rather than percentages, to express interest. You would multiply the factor rate by your loan amount to determine the total cost. Fora Financial’s factor rates start at 1.10 to 1.40, and the lender charges an origination fee up to 2.00%. So, if you borrowed $10,000 with a factor rate of 1.40, you would need to repay $14,000, plus your 2.00% origination fee.

To be eligible for financing, business owners must have:

  • 6 months in business
  • $12,000 in gross monthly sales
  • No open bankruptcies

Time to funding is as little as 72 hours after approval, which is slower than most of the previously discussed lenders — however, Fora Financial could approve your application in as few as 24 hours. It also offers early payoff discounts as low as 10 cents on the dollar.

Tips for choosing an online business loan

To help you make the best decision for your small business, here are some tips to follow.

Shop around. Each lender has its own requirements, APRs and fees, and you may want to compare your options before settling on a loan. You could use LendingTree to evaluate your online business loan choices.

Calculate a desired payment. To make sure you don’t end up with a surprising loan payment, you could calculate how much you can afford to repay before you apply for online business loans. You could use a business loan calculator to determine the maximum APR your business could handle. That way, you would avoid accepting a loan offer with a rate that exceeds your limits.

Understand your risk as a borrower. Several aspects of your business could make you seem risky to lenders, which would raise the APR you might receive. The riskier you are as a borrower, the harder it may be to secure a better rate or a loan altogether. Consider the factors that impact your risk:

  • Poor credit history
  • Little time in business
  • Low profits
  • Unorganized documents and records
  • Little or no collateral to secure the loan (not always necessary)

Recognizing where your business may fall short in the eyes of a lender would allow you to make improvements before applying and help you negotiate an agreement. If one area of your business is lacking, you could highlight others that are in better shape.

Be sure to consider several online business lenders.

Online business loans FAQ

What are the different types of online business loans? Business owners could apply for short-term or long-term online business loans. Short-term loans typically must be repaid in three to 18 months, while long-term loans could have repayment terms between three and 10 years. Longer terms could result in lower APRs, but it could be more difficult to qualify for a long-term loan than a short-term loan.

What are the biggest differences between online business loans and traditional bank loans? Traditional bank loans often have a longer time to funding and stricter eligibility requirements than online loans. However, banks generally offer lower APRs than online business lenders.

How do I apply for an online business loan? You can usually apply for online business loans through a lender’s website. You would need to submit an online application and provide any documents that the lender requires. A lender may also provide an option to apply via phone.

How will I know if I found the best business loan for me? Look for a loan that provides the amount of funding you need at a cost you can afford. Make sure the repayment schedule works with your revenue model. Shop around until you receive a loan offer that you feel comfortable accepting.


Compare Business Loan Offers